July 24, 2020

Ex-owner of Long Beach Pacific Hospital, convicted of kickback scheme, denied early release from prison

By anaheimsigns

Michael Drobot, the ex-owner of now-defunct Long Beach Pacific Hospital who was convicted of operating a kickback scheme that has been called one of the state’s largest fraud cases, was denied early release from Santa Ana City Jail this week.

Lawyers for Drobot, 75, asked the court to consider a compassionate early release for their client because of concerns of the coronavirus but the motion was denied on Tuesday, court documents show.

His original release date was set at March 4, 2023, but that may be extended after he pled guilty to additional crimes and is scheduled to be sentenced for that case next month.

Drobot, of Corona del Mar, operated the scheme from 1998 to 2013. Doctors, chiropractors, marketers and others who referred patients to his hospital for spinal surgery received kickbacks from Drobot’s medical hardware company. The operation included more than $500 million in bills being submitted and paid by the California Workers’ Compensation System from 2008 to 2013.

Some patients involved have said that their surgeries may not have been necessary, with some claiming the hardware used in the surgeries may have been counterfeit and led to chronic health issues.

Drobot pled guilty to the scheme in 2014 and was sentenced to five years in prison in January 2018, in addition to forfeiting $10 million to the government. Drobot was ordered to sell three of his cars as part of the forfeiture to the United States – but instead funneled the money to his personal expenses and to his girlfriend. He pled guilty to those last crimes in September and his sentencing is scheduled for Aug. 21.

“The prevalence of the virus throughout the prison population in the state of California is sufficient to demonstrate that Mr. Drobot is at substantial risk of contracting the virus,” his lawyers said in the motion for early release. “Whatever may be said of Mr. Drobot’s criminal conduct, he should not be subject to constant fear and uncertainty, as well as the likelihood of contracting a serious illness.”

Prosecutors, however, argued that Drobot was a flight risk in court documents opposing the early release. U.S. District Judge Josephine Staton ruled that although concerns of the coronavirus are not unfounded, Drobot was not eligible for early release partly because his “greed resulted in incalculable harm to numerous victims.”

“Even facing a significant prison sentence for his past fraudulent activity, defendant (Drobot) was not deterred from further fraudulent conduct,” Staton wrote in his Tuesday ruling. “This type of conduct is itself a danger to the community, rendering defendant ineligible for the relief sought.”

Drobot is among 15 who have been convicted in the Pacific Hospital scheme, including Drobot’s son. Pacific Hospital was bought by a medical chain and renamed in 2014 to College Medical Center.